Question

Bob returns goods bought on credit from Tariq, which ledger a/c entries record this in Tariq's book?

Answer 1

Answer:

D. Purchase returns Bob

Explanation:

• Purchase refers to payment by credit
• So, it is either B or D
• D sounds like the more sensible option

Answer 2

C. Sales return, Bob

$\begin{tabular}{|c|c|c|c|} \cline{1-4} \cline{1-4} \multicolumn{2}{|c|}{\sf Debit } & \multicolumn{2}{c|}{\sf Credit} \\ \cline{1-4} \multicolumn{2}{|c|}{\sf Bob } & \multicolumn{2}{c|}{\sf sales returns} \\ \cline{1-4} \multicolumn{2}{|c|}{\sf Bob } & \multicolumn{2}{c|}{\sf purchase returns} \\ \cline{1-4} \multicolumn{2}{|c|}{ \sf Sales returns } & \multicolumn{2}{c|}{Bob} \\ \cline{1-4} \multicolumn{2}{|c|}{Purchase returns} & \multicolumn{2}{c|}{Bob} \\\cline{1-4} \end{tabular}$

Breakdown of what's happening:

Credit means borrowing goods and will return them later. Here Credit: Bob
as he borrowed goods from Tariq and returning them.

When comes to sales return and purchase return. Recall,

purchase return: credited

sales return: debited

Hence, debit - sales return, credit - Bob. option C is correct.